New Chief's Mission: Protect Red Hat's Turf

Jan 05, 06:02 AM

Jan. 5--Red Hat's new chief executive plans to thwart advances from larger rivals by waging war on business and political fronts.

Jim Whitehurst, former chief operating officer of Delta Air Lines, is booking nearly a dozen plane trips worldwide over the next two months -- to meet employees, customers and business partners. He wants to reaffirm the Raleigh software company's commitment to the open-source model, where its computer operating software can be modified to fit customers' needs.

Red Hat has grown into a legitimate competitor of the world's biggest software companies under CEO Matthew Szulik, who stepped down so he could attend to family health issues.

But it's under attack from rivals such as Oracle, which last year began distributing copycat versions of Red Hat's Linux operating system and selling support at discount prices. Another group rolled out a second copycat version, CentOS. Microsoft, meanwhile, has teamed with open-source partner Novell.

Whitehurst sees the competitive battle as more than just business.

He said he got a lot of job offers when he left Delta during the summer, but none presented the opportunity to work for a "greater cause."

"I need to work for a company that has a mission, and Red Hat has one: Democratize information," Whitehurst said.

To further fend off competition, Whitehurst is extending the battle to the political arena.

"There are a lot of intellectual property issues that will come before the next president, and we really need to work really hard on these," Whitehurst said from his office in Raleigh on Friday, his fourth day on the job.

He pledged to lobby the next administration for intellectual property policies that protect information flow and the open-source model of sharing.

"Otherwise people like Microsoft will own the digital domain. And as the world becomes more digital, that's scary," Whitehurst said.

"A lot of people don't realize that. They think, 'Hey, I can download XYZ music free. But if it's free today, it might not be free tomorrow."

Red Hat's open-source software is free and open to the public worldwide. The company makes money selling services to businesses that subscribe to its version.

Supporters of open-source software say its collaborative development model leads to better software than the proprietary model embraced by Microsoft, which keeps secret the codes to its Windows operating system and other software.

"Will government information be stored in proprietary formats that require buying certain software, or will it be in open standards?" Whitehurst said.

"These are big, big issues that will impact each individual's freedom."

Whitehurst has a lot before him in the next two months, including a world meeting of Red Hat managers in Raleigh next week. Then he has several trips to Asia, Europe and the West Coast and a highly technical software business to learn inside and out. He must do that while commuting once a week from his home in Georgia over the next six months.

He'll have to work quickly, analysts say. Though Red Hat's financial performance has been decent in recent quarters, its profitability is too dependent on the open-source product line, too much of which is given away free, said analyst Trip Chowdhry of Global Equities Research. Also, Red Hat's model of freely shared software code lowers competitive entry barriers.

But Whitehurst has considerable experience turning around large operations under attack. He is credited by many with helping lift Delta from bankruptcy last year, though he left the company in August after getting passed over for the chief executive spot.

At Red Hat, he plans to emphasize discipline in operations, perhaps more than product adjustments, as the key to success.

"There's no question Red Hat has a clear direction," Whitehurst said. "Our mission, vision and dedication to open-source software will not change.

"I will make sure all that turns into clear, actionable plans that we will execute flawlessly. We will be very, very focused on execution."

frank.norton@newsobserver.com or (919) 829-8926

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